Baytex Energy Corp. demands surveillance

Jun 13th, 2016 – 1 Comment

Needs to hold support at $6.50.


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BTE LOGO

Hey Lou

I have emailed you in the past about a few stocks and I have begun to track a new one these days as oil is showing little but some signs of life.

The company is called Baytex Energy Corp listed on the TSX as BTE.

The last week its had a little jump and I am curious as to your thoughts on a continued trend?

Thanks
Terry

 

Hey Terry,

Thanks for this assignment and your other queries. Its always a good workout! This will be the second time that I explore that potential for Baytex Energy Corp. (BTE TSX). The last time was on November 6, 2015. The shares were trading for $5.95 and BH was sitting on some nice profits having bought in at $4.10 and again at $4.70. He wanted to know what he could expect short and long term.

I advised Terry that my contribution to investors is the analysis of a moment in time. What is required is constant surveillance to recognize changes in the landscape that have consequences over the short and long term. The research conducted last year indicated that BTE had met resistance along the 50-day moving average and the best case scenario would be for some base building until resistance was converted to support for a new move higher.

There was no evidence of a trend reversal and it was advised to consider booking some profits.  In hind sight that was the right call as BTE hit a 52-week low of $1.57 in January of 2016.

Another audit of the charts will inform my thoughts on how best to proceed.

 

BTE

The three-year chart indicates that BTE has given up a lot of ground since 2014. The retreat to the 52-week low in January of 2016 was painful but for those with an appetite for risk the new up leg has been very profitable. The advance has been aggressive, the uptrend line steep, and resistance has come in near $9.00. When these factors come in to play its a call for daily inspections of the charts to monitor the health of the advance.

 

 

 

 

 

 

 

 

 

BTE2

The six-month chart illustrates the overbought situation that surfaced in June and the pullback from $9.00.What is also evident is the support that has come in near $6.50. The MACD and the RSI are indicating we can expect continued selling that could see a retest of $6.50. I would advise waiting to see if $6.50 holds before

 

 

 

 

 

 

 

 

Next time I will re-examine Dollarama Inc.(DOL TSX) for Michael.

 

Make it a profitable day and happy capitalism!

Categories: Energy
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